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Published: 2021-11-18 06:10:33 ET
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EX-99.1 2 ex991q42021.htm EX-99.1 Document

Exhibit 99.1
logoa02a01a01a40.jpg
Kulicke & Soffa Pte. Ltd.
23A Serangoon North Ave 5
Singapore 554369
+65 6880-9600 main
Co. Regn. No. 199902120H
Kulicke and Soffa Industries, Inc.
1005 Virginia Drive
Fort Washington, PA 19034 USA
+1-215-784-6000 main
www.kns.com
 
Kulicke & Soffa Reports Fourth Quarter 2021 Results
Singapore – November 17, 2021 – Kulicke and Soffa Industries, Inc. (NASDAQ: KLIC) (“Kulicke & Soffa”, “K&S” or the “Company”), today announced financial results of its fourth fiscal quarter ended October 2, 2021. The Company reported fourth quarter net revenue of $485.3 million, net income of $133.7 million and non-GAAP net income of $138.3 million.

Quarterly Results - U.S. GAAP
 
Fiscal Q4 2021
 		Change vs.
Fiscal Q4 2020 		Change vs.
Fiscal Q3 2021
Net Revenue$485.3 millionup 173.1%up 14.4%
Gross Profit$231.3 millionup 160.2%up 18.2%
Gross Margin47.7%down 230 bpsup 160 bps
Income from Operations$154.8 millionup 573%up 28.5%
Operating Margin31.9%up 1900 bpsup 350 bps
Net Income$133.7 millionup 746.2%up 17.5%
Net Margin27.6%up 1870 bpsup 80 bps
EPS – Diluted$2.10up 740%up 17.3%
Quarterly Results - Non-GAAP
Fiscal Q4 2021Change vs.
Fiscal Q4 2020		Change vs.
Fiscal Q3 2021
Income from Operations$160.2 millionup 448.7%up 27.2%
Operating Margin33.0%up 1660 bpsup 330 bps
Net Income$138.3 millionup 535.7%up 16.4%
Net Margin28.5%up 1630 bpsup 50 bps
EPS - Diluted$2.17up 520%up 16%
A reconciliation of the GAAP and non-GAAP adjusted results is provided in the financial tables included in this release. See also “Use of non-GAAP Financial Results” section.

During the fiscal fourth quarter the Company was able to exceed revenue expectations by temporarily extending production capacity and also by delivering additional advanced display systems and services.

Fusen Chen, Kulicke & Soffa's President and Chief Executive Officer, stated, "Throughout fiscal 2021 we continued to support an ongoing period of industry expansion, while carefully navigating global supply-chain challenges. Additionally, we continued our aggressive development efforts, released several new market-ready solutions and also received customer acceptance with several others. These efforts expand our access to favorable long-term trends within the automotive, electronics assembly and advanced display end-markets."

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Fiscal Year 2021 Financial Highlights
•Net revenue of $1,517.7 million.    
•Gross margin of 45.9%.
•Net income of $367.2 million or $5.78 per share; non-GAAP net income of $390.2 million or $6.14 per share.
•The Company repurchased a total of approximately 215.0 thousand shares of common stock at a cost of approximately $10.2 million.

Fourth Quarter Fiscal 2021 Financial Highlights 
•Net revenue of $485.3 million.    
•Gross margin of 47.7%.
•Net income of $133.7 million or $2.10 per share; non-GAAP net income of $138.3 million or $2.17 per share.
•Cash, cash equivalents, and short-term investments were $739.8 million as of October 2, 2021.

First Quarter Fiscal 2022 Outlook
The Company currently expects net revenue in the first fiscal quarter of 2022, ending January 1, 2022, to be approximately $460 million, +/- $20 million, and expects non-GAAP EPS to be approximately $1.88, +/- 10%.

This revenue outlook is very similar to the fourth fiscal quarter expectations provided on August 4, 2021.

Looking forward, Fusen Chen commented, "We continue to efficiently support strong, ongoing and broad demand across our served end-markets. Throughout fiscal 2022, we anticipate ongoing industry expansion and also rapid growth of our emerging portfolio of solutions which directly addresses semiconductor, electric vehicle, and advanced LED assembly challenges."

Earnings Conference Call Details
A conference call to discuss these results will be held tomorrow, November 18, 2021, beginning at 8:00am EST. To access the conference call, interested parties may call +1-877-407-8037 or internationally +1-201-689-8037. A live webcast will also be available at investor.kns.com.
A replay will be available from approximately one hour after the completion of the call through November 25th by calling toll-free +1-877-660-6853 or internationally +1-201-612-7415 and using the replay ID number of 13723617. A webcast replay will also be available at investor.kns.com.

Use of Non-GAAP Financial Results
In addition to U.S. GAAP results, this press release also contains non-GAAP financial results. The Company's non-GAAP results exclude amortization related to intangible assets acquired through business combinations, costs associated with restructuring, equity-based compensation, acquisition and integration cost, impairment relating to assets acquired through business combinations, income tax expense arising from discrete tax items triggered by significant changes in tax laws, gain/loss on disposal of business, as well as tax benefits or expense associated with the foregoing non-GAAP items. The non-GAAP adjustments may or may not be infrequent or nonrecurring in nature, but are a result of periodic or non-core operating activities. These non-GAAP measures are consistent with the way management analyzes and assesses the Company’s operating results. The Company believes these non-GAAP measures enhance investors’ understanding of the Company’s underlying operational performance, as well as their ability to compare the Company’s period-to-period financial results and the Company’s overall performance to that of its competitors.
Management uses both U.S. GAAP metrics as well as non-GAAP metrics to evaluate the Company's operating and financial results. Non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in the Company’s industry, as other companies in the industry may calculate non-GAAP financial results differently. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on the Company’s reported financial results. The presentation of non-GAAP items is meant to supplement, but not substitute for, GAAP financial measures or information. The Company believes the presentation of non-GAAP results in combination with GAAP results provides better transparency to the investment community when analyzing business trends, providing meaningful comparisons with prior period performance and enhancing investors' ability to view the Company's results from management's perspective. A reconciliation of each available GAAP to non-GAAP financial measure discussed in this press release is contained in the financial tables at the end of this press release.
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Management has not reconciled its outlook for non-GAAP Diluted EPS to Diluted EPS for Q1F22 as it does not provide guidance on the reconciling items between Diluted EPS and non-GAAP Diluted EPS, as a result of the uncertainty regarding, and the potential variability of, these items. The actual amount of such reconciling items could have a significant impact on our non-GAAP Diluted EPS and, accordingly, a reconciliation of Diluted EPS to non-GAAP Diluted EPS for Q1F22 is not available without unreasonable effort.

About Kulicke & Soffa
 
Kulicke & Soffa (NASDAQ: KLIC) is a leading provider of semiconductor, LED and electronic assembly solutions serving the global automotive, consumer, communications, computing and industrial markets. Founded in 1951, K&S prides itself on establishing foundations for technological advancement - creating pioneering interconnect solutions that enable performance improvements, power efficiency, form-factor reductions and assembly excellence of current and next-generation semiconductor devices.
Leveraging decades of development proficiency and extensive process technology expertise, Kulicke & Soffa’s expanding portfolio provides equipment solutions, aftermarket products and services supporting a comprehensive set of interconnect technologies including wire bonding, advanced packaging, lithography, and electronics assembly. Dedicated to empowering technological discovery, always, K&S collaborates with customers and technology partners to push the boundaries of possibility, enabling a smarter future (kns.com).
Caution Concerning Results and Forward Looking Statements
In addition to historical statements, this press release contains statements relating to future events and our future results. These statements are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our judgments and future expectations concerning our business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to, the effects of the COVID-19 pandemic on our business, the effects of supply chain constraints on our business, and the other factors listed or discussed in our Annual Report on Form 10-K for the fiscal year ended October 3, 2020, filed on November 20, 2020, and our other filings with the Securities and Exchange Commission. Kulicke and Soffa Industries, Inc. is under no obligation to (and expressly disclaims any obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.


Contacts:
Kulicke & Soffa Industries, Inc.
Joseph Elgindy
Investor Relations & Strategic Initiatives
P: +1-215-784-7518
F: +1-215-784-6180
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KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except per share and employee data)
(Unaudited)
 Three months endedTwelve months ended
October 2, 2021October 3, 2020October 2, 2021October 3, 2020
Net revenue$485,326 $177,688 $1,517,664 $623,176 
Cost of sales254,011 88,803 820,678 325,201 
Gross profit231,315 88,885 696,986 297,975 
Operating expenses:
Selling, general and administrative40,186 28,101 139,224 107,947 
Research and development34,929 35,553 137,478 123,459 
Acquisition-related cost— — 1,730 — 
Amortization of intangible assets1,322 1,920 5,974 7,371 
Restructuring42 263 133 689 
Total operating expenses76,479 65,837 284,539 239,466 
Income from operations154,836 23,048 412,447 58,509 
Other income / (expense):
Interest income520 653 2,321 7,541 
Interest expense(72)(26)(218)(1,716)
Income before income taxes155,284 23,675 414,550 64,334 
Income tax expense / (benefit)21,573 8,013 47,295 11,998 
Share of results of equity-method investee, net of tax— (122)94 36 
Net income $133,711 $15,784 $367,161 $52,300 
Net income per share:
Basic$2.16 $0.26 $5.92 $0.83 
Diluted$2.10 $0.25 $5.78 $0.83 
Cash dividends declared per share$0.14 $0.12 $0.56 $0.48 
Weighted average shares outstanding:
Basic61,966 61,791 62,009 62,828 
Diluted63,611 62,411 63,515 63,359 

 Three months endedTwelve months ended
Supplemental financial data:October 2, 2021October 3, 2020October 2, 2021October 3, 2020
Depreciation and amortization$5,258 $5,142 $19,810 $19,739 
Capital expenditures5,792 5,964 22,555 14,514 
Equity-based compensation expense:
Cost of sales202 147 828 744 
Selling, general and administrative2,887 2,965 10,998 11,071 
Research and development909 851 3,676 3,204 
Total equity-based compensation expense$3,998 $3,963 $15,502 $15,019 

 As of
October 2, 2021October 3, 2020
Backlog of orders 1
$787,241 $127,924 
Number of employees3,586 2,836 
1.Represents customer purchase commitments. While the Company believes these orders are firm, they are generally cancellable by customers without penalty.
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KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
As of
October 2, 2021October 3, 2020
ASSETS
CURRENT ASSETS
Cash and cash equivalents$362,788 $188,127 
Short-term investments377,000 342,000 
Accounts and notes receivable, net of allowance for doubtful accounts of $687 and $968 respectively421,193 198,640 
Inventories, net167,323 111,809 
Prepaid expenses and other current assets23,586 19,620 
TOTAL CURRENT ASSETS1,351,890 860,196 
Property, plant and equipment, net67,982 59,147 
Operating right-of-use assets41,592 22,688 
Goodwill72,949 56,695 
Intangible assets, net42,752 37,972 
Deferred tax assets15,715 8,147 
Equity investments6,388 7,535 
Other assets2,363 2,186 
TOTAL ASSETS$1,601,631 $1,054,566 
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES  
Accounts payable154,636 57,688 
Operating lease liabilities4,903 5,903 
Accrued expenses and other current liabilities161,570 76,762 
Income taxes payable30,766 17,540 
TOTAL CURRENT LIABILITIES351,875 157,893 
Deferred tax liabilities32,828 33,005 
Income taxes payable69,422 74,957 
Operating lease liabilities38,084 18,325 
Other liabilities14,185 12,392 
TOTAL LIABILITIES506,394 296,572 
SHAREHOLDERS' EQUITY  
Common stock, no par value550,117 539,213 
Treasury stock, at cost(400,412)(394,817)
Retained earnings948,554 616,119 
Accumulated other comprehensive loss(3,022)(2,521)
TOTAL SHAREHOLDERS' EQUITY$1,095,237 $757,994 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$1,601,631 $1,054,566 
 
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KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
 Three months endedTwelve months ended
 October 2, 2021October 3, 2020October 2, 2021October 3, 2020
Net cash provided by operating activities$123,376 $31,731 $300,032 $94,412 
Net cash used in investing activities, continuing operations(135,928)(151,820)(81,707)(125,957)
Net cash used in financing activities, continuing operations(12,276)(15,191)(44,258)(145,809)
Effect of exchange rate changes on cash and cash equivalents(383)1,632 594 1,297 
Changes in cash and cash equivalents (25,211)(133,648)174,661 (176,057)
Cash and cash equivalents, beginning of period387,999 321,775 188,127 364,184 
Cash and cash equivalents, end of period $362,788 $188,127 $362,788 $188,127 
Short-term investments377,000 342,000 377,000 342,000 
Total cash, cash equivalents, and short-term investments$739,788 $530,127 $739,788 $530,127 

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Reconciliation of U.S. GAAP Income from Operating
to Non-GAAP Income from Operation and Operating Margin
(In thousands, except percentages)
(unaudited)
 Three months ended
October 2, 2021October 3, 2020July 3, 2021
Net revenue$485,326 $177,688 $424,318 
U.S. GAAP income from operations154,836 23,048 120,455 
U.S. GAAP operating margin31.9 %13.0 %28.4 %
Pre-tax non-GAAP items:
Amortization related to intangible assets acquired through business combination- selling, general and administrative$1,322 $1,920 1,340 
Equity-based compensation (a)
3,998 3,963 4,140 
Restructuring42 263 — 
Non-GAAP income from operations$160,198 $29,194 $125,935 
Non-GAAP operating margin33.0 %16.4 %29.7 %
(a)This non-GAAP measure is newly included for the three months ended January 2, 2021. Comparatives have been included.
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Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income and
U.S. GAAP net income per share to Non-GAAP net income per share
(in thousands, except per share data)
(unaudited)
 Twelve months endedThree months ended
October 2, 2021October 2, 2021October 3, 2020July 3, 2021
Net revenue$1,517,664 $485,326 $177,688 $424,318 
U.S. GAAP net income367,161 133,711 15,784 113,766 
U.S. GAAP net margin24.2 %27.6 %8.9 %26.8 %
Non-GAAP adjustments:
Amortization related to intangible assets acquired through business combination- selling, general and administrative$5,974 $1,322 $1,920 1,340 
Restructuring133 42 263 — 
Acquisition-related costs1,730 — — — 
Equity-based compensation15,502 3,998 3,963 4,140 
Net income tax (benefit)/expense on non-GAAP items(311)(807)(181)(460)
Total non-GAAP adjustments23,028 4,555 5,965 5,020 
Non-GAAP net income390,189 138,266 21,749 118,786 
Non-GAAP net margin25.7 %28.5 %12.2 %28.0 %
U.S. GAAP net income per share:
Basic5.92 2.16 0.25 1.83 
Diluted(a)
5.78 2.10 0.25 1.79 
Non-GAAP adjustments per share:(b)
Basic0.37 0.07 0.10 0.08 
Diluted0.36 0.07 0.10 0.08 
Non-GAAP net income per share:
Basic$6.29 $2.23 $0.35 $1.91 
Diluted(c)
$6.14 $2.17 $0.35 $1.87 
Weighted average shares outstanding:
Basic62,009 61,966 61,791 62,023 
Diluted(b)
63,515 63,611 62,411 63,485 
(a)GAAP diluted net earnings per share reflects any dilutive effect of outstanding restricted stock units and stock options, but that effect is excluded when calculating GAAP diluted net (loss) per share because it would be anti-dilutive.
(b)Non-GAAP adjustments per share includes amortization related to intangible assets acquired through business combinations, costs associated with restructuring, equity-based compensation expenses, and acquisition-related costs as well as tax benefits or expense associated with the foregoing non-GAAP items.
(c)Non-GAAP diluted net earnings per share reflects any dilutive effect of outstanding restricted stock units and stock options.

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